Yellow Pages restructure plan will wipe out shareholders

BELEAGUERED Yellow Pages publisher Hibu will submit a restructuring plan to its lenders as early as this week, which it hopes will convince them to give the green light to a lifesaving debt-for-equity swap.

The struggling directories business told investors its shares would be worthless

Despite being worth only £8 million Hibu, which was formerly known as Yell, is creaking under debts of more than £2 billion.

If the restructuring plan is approved, Hibu’s lenders would take control of the firm in exchange for forgiving its debts. However, shareholders would be wiped out.

Hibu declined to comment. The struggling directories business last year warned investors that their shares are likely to become worthless if the debt for equity swap goes ahead. Deloitte is advising Hibu’s management on the restructuring plan.

Once a stock market darling, Hibu built up its debt mountain during the Noughties by embarking upon a series of acquisitions in the US and Spain, just as revenues from its printed ­directories businesses started to fall due to online competition.

The directories group is due to present its third-quarter results on Tuesday. While the firm’s online and digital operations are expected to show growth, its traditional printed ­directories businesses are set to show sharp revenue falls.